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Fort McMurray’s local politicians have narrowly rejected plans to impose a moratorium on work camps near their community at the heart of the Canadian oil sands.

The proliferation of work camps, which provide temporary housing for much of the labour force that operates gargantuan oil sands projects, has become a divisive issue in Fort McMurray. The city’s mayor has long complained that the thousands of fly-in-fly-out workers at nearby oil and gas facilities don’t contribute enough to the local economy, which has suffered in recent years.

Councillors with the Regional Municipality of Wood Buffalo, the sprawling area in northeastern Alberta that includes Fort McMurray and dozens of oil sands facilities, voted down a motion on Tuesday evening that would’ve prohibited work camps within 75 kilometres of the area’s urban centre. The motion was defeated in a five to five vote.

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Mayor Don Scott had proposed the moratorium in January, telling The Globe and Mail at the time that he thought that paring back the temporary camps would help fill Fort McMurray’s empty homes and apartments, while boosting local sales. Mr. Scott was unavailable to comment on the proposal’s rejection.

Councillor Jane Stroud said that council had first raised concerns in 2006 over the number of local camps, which continues to increase. She said there are more than 60,000 beds in the work camps that ring Fort McMurray, which itself has a local population of about 85,000.

“I believe the moratorium was going to give us some leverage to get control over camp accommodations,” she told The Globe, expressing her disappointment with the vote. “Six years ago we had the lowest vacancy rate in Alberta, we now have the highest.”

Housing prices in the city are slowly increasing after a severe downturn that saw most properties lose a quarter of their value after 2015. Most home prices in the area are near where they were a decade ago.

Sheila Lalonde, a local councillor who voted against the moratorium, said she has concerns about the number of workers in camps.

“The issue is that I feel Fort McMurray is being flown over and not necessarily flown in to,” she said. However, she felt that forbidding all camps close to the community wasn’t the right way to deal with the issue: “Fort McMurray needs stable growth, it doesn’t need more booms-and-busts.”

According to Ms. Lalonde, a number of work sites within 75 km of Fort McMurray can only be reached by circuitous, narrow roads that turn to gravel. The winding roads don’t make for a good commute. She was also concerned that other temporary accommodations, such as those used by road-paving crews, could be curtailed by the new rules.

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Oil producers have warned that the moratorium would hurt the industry. After Tuesday’s vote, the regional council will be considering new regulations on where camps are built and how many beds are allowed. They could also create a system requiring camp operators to reapply for permits every few years to remain open.

Karim Zariffa, the executive director of the Oil Sands Community Alliance, said the council’s decision will help defuse a divisive issue that made a number of employers uncomfortable. “They’ve recognized that this is a complex issue and applying a one-size-fits-all moratorium isn’t the answer,” he said.

He said he’ll be working with the council to develop incentives to get workers to move to the area.

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